Dr. James P Womack writes of The End of An Era as General Motors declared bankruptcy. He asks:
The first truly modern, manage-by-the-numbers corporation, created by Alfred Sloan in the 1920s, was laid to rest as a viable concept. But what comes next?
Dr. Womack places GM’s bankruptcy as the final page in a 30-year lean narrative revolving around the battle of ideas between GM (not lean?) and Toyota (lean). I have only been a conscious part of the lean community for the past 16 years, and much of that spent in aerospace, defense or consumer goods and service industries, so this “David versus Goliath” framing between two automotive giants doesn’t ring exactly true. Was there ever any debate or contest between Toyota and GM for the past decade at least in terms of quality, cost, profitability and the underlying strengths of their management systems?
Dr. Womack aptly summarizes GM’s weaknesses in three points basically as legacy and compensation costs that are too high and revenues that are too low “partly as a legacy of decades of defective products and partly due to losing the pulse of the public on what the company and its products should mean for customers.” Yet the narrative is far from over as Toyota’s resilience is being severely tested during this recession as it deals with the hangover from its binge of expansion of the past few years.
The point that the Sloan era is over for GM can be made, and Dr. Womack asks “where is the new Sloan, the leader able to rethink GM’s management and purpose and make it relevant to Americans again?” However extending this to an end of an era for the lean community, where there has been a battle of ideas centering around the GM system and the Toyota system, seems a stretch. In the letter, Dr. Womack states:
GM and almost all large manufacturers have now accepted lean as a management theory, although the actual practice is always a struggle.
Really? If by “accepted” we mean people are saying “yes, lean is a management theory” then perhaps so. Both scientists and evangelicals may accept evolution and creationism as theories of species origin, but this is far from saying that there is consensus on the superiority of one over the other or that the debate is over. Based on an adoption rate for lean within industry of something between 5% and 20% of lean practices, we have a long way to go in building awareness and acceptance.
We in the Lean Community therefore find ourselves in the odd position of winning a battle of ideas without actually getting most believers to fully practice their new convictions.
If, as Taiichi Ohno said, “Understanding means doing” can we really say that we have won the “battle of ideas?” In fact, what has the lean community done to win the battle of ideas? The lean management system a.k.a. the Toyota way already existed fully-formed when the so-called lean community formed around this idea and went to battle. This victory seems rather premature and self-congratulatory, and it’s link with GM’s demise arbitrary. Toyota and GM are just two automotive companies, part of a broader narrative on competitiveness whose outcome was accelerated by the shenanigans of the American financial institutions. Without the financial collapse GM could have held on for perhaps 3-5 years and even inched closer in competitiveness to Toyota as they struggled from overproduction and overcapacity.
So the dramatic events of recent weeks are not a time for self-congratulation. Instead, they are a time for modesty and self-reflection – hansei, if you will – as we all struggle with the economic crisis while trying to re-define our own purpose as a Lean Community for the new era ahead.
If there is a battle of ideas, it is far from won. Lean is all about practice and not about competing management theories. Late in his career Taiichi Ohno repeatedly stressed “pratice, not theory” as he saw academicians studying Toyota’s method and attempting to quantify and categorize it. I think he foresaw the danger of reducing the struggle against complacency, self-satisfaction, loss of customer focus and tolerance of small wastes that result from attempting to precisely define and label kaizen and shop floor management. For Taiichi Ohno, Henry Ford and other early practitioners of lean thought it was all about acting with a sense of urgency, with customer focus and improving continuously.
If anything, the “end of an era” simply means that the lean community no longer has General Motors to kick around as the anti-exemplar of a lean enterprise. All efforts in any battle of ideas should be towards helping the opposite side to win by taking the correct path. If this has not happened, we have won no battle. In fact, while lean is important, such a battle of ideas is not what really matters in times of tumultuous change like today. What’s next for lean? It’s high time that we broadened the discussion beyond automobiles, manufacturing, or even the corporate world. We need to turn the discussion towards solving problems for our customers towards how we can help the people who work at GM or people who are otherwise struggling, regardless of whether they are lean-minded.